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Accounting Policies of N D Metal Industries Ltd. Company

Mar 31, 2015

1. Basis of Preparation of financial Statements:

a. The Financial Statements are prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b. The Company generally follows mercantile system of accounting and recognizes significant items of Income and Expenditure on accrual basis.

2. Use of Estimates:

The preparation of financial statements in conformity with generally accepted accounting principles requires that the management of the company makes estimates and assumptions that affect the reported amounts of income and expenses of the year, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of the date of the financial statements. Examples of such estimates include the useful lives of fixed assets, provision for doubtful debts / advances, future obligations in respect of retirement benefit plans etc. Actual results could differ from these estimates.

3. Fixed Assets:

Tangible Assets are stated at Cost less accumulated depreciation and net of impairment, if any. The Cost comprises purchase price, borrowing cost if capitalization criteria are met and directly attributable cost of bringing the asset to its working conditions for the intended use. Any trade discount and rebates are deducted in arriving at the purchase price. All direct cost attributable to acquisition / Installation of Assets are capitalized. Borrowing Cost if any during the construction period shall be added to the cost of eligible tangible assets.

4. Depreciation:

The Company is providing depreciation on Fixed Assets on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 instead of rates and manner prescribed in schedule 11 of the companies Act, 2013.

Depreciation on addition is charged proportionally from the date of acquisition / installation of Assets.

5. Inventories:

Inventories is mentioned and valued on FIFO basis as follows:

a) Finished Goods :-at cost or Net realizable value whichever is lower, after Providing for the value of excise duty payable.

b) Raw Material :- at cost

c) Stock In Transit : - at cost.

d) Sores & Spares : - at cost.

el Ash & Dust :- at Realizable Value

6. Revenue Recognition:

a. Sales are recognized on accrual basis and recorded net of Goods Return, Sales Tax, Excise Duty and sales incentive.

b. Interest Income on Fixed Deposits Receipt and Rent Income is recognized on accrual basis.

7. Foreign Exchange Transactions:

* Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

* Monetary items denominated in foreign currencies at the year-end and not covered by forward exchange contracts are translated at the year end rates, and those covered by forward exchange contracts are translated at the rate ruling at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference have been recognized over the life of the contract.

* Any income or expense on account of exchange difference either on settlement or on translation is r recognized in the profit or loss account net of recoverable amount.

8. Impairment of Assets:

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable amount is the higher of an asset's net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arm's length transaction between knowledgeable, willing parties less the cost of disposal. An impairment loss is charged to the profit and loss in the year in which an asset is identified as impaired.

9. Excise Duty:

The Company has provided for the Excise Duty payable on the finished goods as stated in the Accounting

Standard/Guidance notes issued by the Institute of Chartered Accountant of India.

10. Purchases:

Purchases are accounted at the time of receipt of material.

11. Taxes On Income:

(i) Current Taxation

Taxes are accounted for in accordance with Accounting Standard - 22 "Accounting for taxes on income" Current tax are determined as the amount of tax payable in respect of taxable income for the year. A provision is made for income tax annually based on the tax liability computed, after considering tax allowances and exemptions. Provisions are recorded when it is estimated that a liability due to disallowances or other matters is probable. .

(ii) Deferred Taxation

Deferred tax assets and liabilities are recognized, subject to prudence, on timing differences, being the difference between taxable incomes and accounting income, that originates in one period and is capable of reversal in one or more subsequent periods and quantified using the tax rates and laws enacted or substantively enacted by the reporting date. Deferred tax assets are recognized only if there is reasonable or virtual certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

12. Employees Benefit:

A) Provident Fund and ESIC Contribution:

Provident fund and ESIC is a defined contribution scheme and the contribution as required by the statue is not applicable to the company. Hence the same is not debited to the profit & loss account.

B) Gratuity:

Gratuity for the eligible employees is considered as defined benefits obligation and provided for on the basis of calculation as per Payment of Gratuity Act, 1972; however actuarial valuation is not done for the same.

13. Provisions. Contingent Liabilities and contingent assets:

Provision involving substantial degree of estimation in measurement is recognized when there is a present obligation as a result of past event and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized not disclosed in the financial statements.




Mar 31, 2014

1. Basis of Preparation of financial Statements:

a. The Financial Statements are prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistendy by the Company.

b. The Company generally follows mercantile system of accounting and recognizes significant items of Income and Expenditure on accrual basis.

2. Use of Estimates:

The preparation of financial statements in conformity with generally accepted accounting principles requires that the management of the company makes estimates and assumptions that affect the reported amounts of income and expenses of the year, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of the date of the financial statements. Examples of such estimates include the useful lives of fixed assets, provision for doubtful debts / advances, future obligations in respect of retirement benefit plans etc. Actual results could differ from these estimates.

3. Fixed Assets:

Tangible Assets are stated at Cost less accumulated depreciation and net of impairment, if any. The Cost comprises purchase price, borrowing cost if capitalization criteria are met and directly attributable cost of bringing the asset to its working conditions for the intended use. Any trade discount and rebates are deducted in arriving at the purchase price. All direct cost attributable to acquisition / Installation of Assets are capitalized. Borrowing Cost if any during the construction period shall be added to the cost of eligible tangible assets.

4. Depredation:

The Company is providing depreciation on Fixed Assets on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

Depreciation on addition is charged proportionally from the date of acquisition / installation of Assets.

5. Inventories:

Inventories is mentioned and valued on FIFO basis as follows:

a) Finished Goods :- at cost or Net realizable value whichever is lower, after Providing for the value of excise duty payable.

b) Raw Material :¦ at cost

c) Stock In Transit :-at cost

d) Sores & Spares : - at cost.

e) Ash & Dust :- at Realizable Value

6. Revenue Recognition:

a. Sales are recognized on accrual basis and recorded net of Goods Return, Sales Tax, Excise Duty and sales incentive.

b. Interest Income on Fixed Deposits Receipt and Rent Income is recognized on accrual basis.

7. Foreign Exchange Transactions;

- Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

- Monetary items denominated in foreign currencies at the year-end and not covered by forward exchange contracts are translated at the year end rates, and those covered by forward exchange contracts are translated at the rate ruling at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference have been recognized over the life of the contract

- Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit or loss account net of recoverable amount

8. Impairment of Assets:

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable amount is the higher of an asset''s net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arm''s length ''transaction between knowledgeable, willing parties less the cost of disposal. An impairment loss is charged to the profit and loss in the year in which an asset is identified as impaired.

9. Excise Duty:

The Company has provided for the Excise Duty payable on the finished goods as stated in the Accounting Standard/Guidance notes issued by the Institute of Chartered Accountant of India.

10. Purchases:

Purchases are accounted at the time of receipt of material.

11. Taxes On Income:

(i) Current Taxation

Taxes are accounted for in accordance with Accounting Standard - 22 "Accounting for taxes on income" Current tax are determined as the amount of tax payable in respect of taxable income for the year. A provision is made for income tax annually based on the tax liability computed, after considering tax allowances and exemptions. Provisions are recorded when it is estimated that a liability due to disallowances or other matters is probable.

(ii) Deferred Taxation

Deferred tax assets and liabilities are recognized, subject to prudence, on timing differences, being the difference between taxable incomes and accounting income, that originates in one period and is capable of reversal in one or more subsequent periods and quantified using the tax rates and laws enacted or substantively enacted by the reporting date. Deferred tax assets are recognized only if there is reasonable or virtual certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

12. Employees Benefit:

A) Provident Fund and ESIC Contribution:

Provident fund and ESIC is a defined contribution scheme and the contribution as required by the statue is not applicable to the company. Hence the same is not debited to the profit & loss account.

B) Gratuity:

Gratuity for the eligible employees is considered as defined benefits obligation and provided for on the basis of calculation as per Payment of Gratuity Act, 1972; however actuarial valuation is not done for the same.

13. Provisions. Contingent Liabilities and contingent assets:

Provision involving substantial degree of estimation in measurement is recognized when there is a present obligation as a result of past event and it is probable that there will be an outflow of resources. Contingent -Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized not disclosed in the financial statements.


Mar 31, 2013

1. Basis of Preparation of financial Statements:

a. The Financial Statements are prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistentiy by the Company.

b. The Company generally follows mercantile system of accounting and recognizes significant items of Income and Expenditure on accrual basis.

1 Use of Estimates:

The preparation of financial statements in conformity with generally accepted accounting principles requires that the management of the company makes estimates and assumptions that affect the reported amounts of income and expenses of the year, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of the date of the financial statements. Examples of such estimates include the useful lives of fixed assets, provision for doubtful debts / advances, future obligations in respect of retirement benefit plans etc. Actual results could differ from these estimates.

3. Fixed Assets:

Tangible Assets are stated at Cost less accumulated depreciation and net of impairment, if any. The Cost comprises purchase price, borrowing cost if capitalization criteria are met and directly attributable cost of bringing the asset to its working conditions for the intended use. Any trade discount and rebates are deducted in arriving at the purchase price. All direct cost attributable to acquisition / Installation of Assets are capitalized. Borrowing Cost if any during the construction period shall be added to the cost of eligible tangible assets.

4. Depreciation:

The Company is providing depreciation on Fixed Assets on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

Depreciation on addition is charged proportionally from the date of acquisition / installation of Assets.

5. Inventories;

Inventories is mentioned and valued on FIFO basis as follows:

a) Finished Goods :- at cost or Net realizable value whichever is lower, after Providing for the value of excise duty payable.

b) Raw Material :- at cost

c) Stock In Transit :-at cost. dl Sores & Spares :-at cost

ej Ash & Dust :- at Realizable Value

6. Revenue Recognition:

a. Sales are recognized on accrual basis and recorded net of Goods Return, Sales Tax, Excise Duty and sales incentive.

b. Interest Income on Fixed Deposits Receipt and Rent Income is recognized on accrual basis.

7. Foreign Exchange Transactions:

- Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

- Monetary items denominated in foreign currencies at the year-end and not covered by forward exchange contracts are translated at the year end rates, and those covered by forward exchange contracts are translated at the rate ruling at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference have been recognized over the life of the contract.

- Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit or loss account net of recoverable amount.

8. Impairment of Assets:

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable amount is the higher of an asset''s net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arm''s length transaction between knowledgeable, willing parties less the cost of disposal. An impairment loss is charged to the profit and loss in the year in which an asset is identified as impaired.

9. Excise Duty:

The Company has provided for the Excise Duty payable on the finished goods as stated in the Accounting Standard/Guidance notes issued by the Institute of Chartered Accountant of India.

10. Purchases:

Purchases are accounted at the time of receipt of material.

11. Taxes On Income:

(i) Current Taxation

Taxes are accounted for in accordance with Accounting Standard - 22 "Accounting for taxes on income" Current tax are determined as the amount of tax payable in respect of taxable income for the year. A provision is made for income tax annually based on the tax liability computed, after considering tax allowances and exemptions. Provisions are recorded when it is estimated that a liability due to disallowances or other matters is probable.

(ii) Deferred Taxation

Deferred tax assets and liabilities are recognized, subject to prudence, on timing differences, being the difference between taxable incomes and accounting income, that originates in one period and is capable of reversal in one or more subsequent periods and quantified using the tax rates and laws enacted or substantively enacted by the reporting date. Deferred tax assets are recognized only if there is reasonable or virtual certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

12. Employees Benefit:

A) Provident Fund and ES1C Contribution:

Provident fund and ESIC is a defined contribution scheme and the contribution as required by the statue is not applicable to the company. Hence the same is not debited to the profit & loss account.

B) Gratuity:

Gratuity for the eligible employees is considered as defined benefits obligation and provided for on the basis of calculation as per Payment of Gratuity Act, 1972; however actuarial valuation is not done for the same.

13. Provisions. Contingent Liabilities and contingent assets:

Provision involving substantial degree of estimation in measurement is recognized when there is a present obligation as a result of past event and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized not disclosed in the financial statements.


Mar 31, 2010

1. Basis of Preparation of financial Statements:

a. The Financial Statements arc prepared under the historical tost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b. The Company generally follows mercantile system of accounting and recognizes significant items of Income and Expenditure on accrual basis.

2. Use of Estimates:

The preparation of financial statements in conformity with generally accepted accounting principles requires that the management of the company makes estimates and assumptions that affect the reported amounts of income and expenses of the year, the reported balances of assets and liabilities and the disclosures relating lo contingent liabilities as of the date of the financial statements. Examples of such estimates include the useful lives of fixed assets, provision for doubtful debts / advances, future obligations in respect of retirement benefit plans etc. Actual results could differ from these estimates.

3. Fixed Assets:

Fixed Assets are stated at cost, net of Modvat and include amount added on revaluation less accumulated depreciation. The expenditure during construction period, including the cost of financing till ihc Assets are put to use and the net of income are allocated to the cost of Building and Plant and Machinery.

4. Depreciation:

The Company is providing depreciation on Fixed Assets on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

Depreciation on addition is charged proportionally from the date of acquisition / installation of Assets.

5. Inventory:

Inventory is mentioned and valued on FIIO Basis as follows.

a) Finished Goods:- at cost or market price whichever is lower, after providing for the value of Excise Duty payable.

b) Raw Material ;- at cost.

c) Stock In Transit:- at cost.

d) Stores & Spares,- at cost.

e) Ash & Dust > at net realisable value.

6- Sales:

Sales are recognized on Accrual basis and recorded net of Excise duty, Sales Tax & Sales Incentives.

7. Foreign Exchange Transactions:

- Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing al the time of the transaction.

- Monetary items denominated in foreign currencies at the year-end and not covered by forward exchange contracts are translated at the year end rates, and those covered by forward exchange contracts are translated at the rate ruling at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference have been recognized over the life of the contract.

- Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit or loss account net of recoverable amount.

8. Impairment of Assets:

An asset is treated as unpaired when the carrying cost of asset exceeds its recoverable value. Recoverable amount is the higher of an assets net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arms length transaction between knowledgeable, willing parties less the cost of disposal. An impairment loss is charged to the profit and loss in the year in which an asset is identified as impaired.

9. Excise Duty:

The Company has provided for the Excise Duty payable on the finished goods as stated in the Accounting Standard 2/Guidance Notes issued by the Institute of Chartered Accountant of India.

10. Purchases:

Purchases are accounted at the time of receipt of material.

11. Employee Benefit:

A) Provident Fund and ESIC Contribution:

Provident fund and ESIC is a defined contribution scheme and the contribution as required by the statue is not applicable to the company. Hence the same is not debited to the profit & loss account.

B} Gratuity:

Gratuity for the eligible employees is considered as defined benefits obligation and provided for on the basis of calculation as per Payment of Gratuity Act, 1972 and considering the size of the organization actuarial valuation is not done for the same.

12. Taxes On Income:

(i) Current Taxation

Taxes are accounted for in accordance with Accounting Standard - 22 "Accounting for taxes on income" Current tax are determined as the amount of tax payable in respect of taxable income for the year. A provision is made for income tax annually based on the tax liability computed, after considering tax allowances and exemptions. Provisions are recorded when it is estimated that a liability due to disallowances or other matters is probable.

(ii) Deferred Taxation

Deferred tax assets and liabilities are recognized, subject to prudence, on timing differences, being the difference between taxable incomes and accounting income, that originates in one period and is capable of reversal in one or more subsequent periods and quantified using the tax rates and laws enacted or substantively enacted by the reporting date. Deferred tax assets are recognized only if there is reasonable or virtual certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

13. Provisions Contingent Liabilities and contingent assets:

Provision involving substantial degree of estimation in measurement is recognized when there is a present obligation as a result of past event and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but ace disclosed in the notes. Contingent assets are neither* recognized not disclosed in the financial statements.

 
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